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The Application of New Product Development Tools in Industry: The Case of Singapore
Kah-Hin Chai, Member, IEEE, and Yan Xin, Student Member, IEEE
AbstractLiterature suggests that new product development (NPD) is critical for industrial rms to gain a competitive advantage. Intriguingly, the systematic application of NPD tools in industry, despite the extensive effort that has been invested and the benets that can be obtained, remains mostly uncommon. By conducting ten semi-structured interviews with selected academics and industrialists and using a sample of 67 industrial rms in Singapore for questionnaire survey, this empirical study investigates the diffusion and adoption of NPD tools in industry. It also probes the factors which may affect the application of NPD tools. Our ndings reveal that the application of NPD tools is still under-exploited in most of the industrial companies in Singapore. Although the application of NPD tools is affected by many factors, the most signicant are management support in the company and the innovativeness orientation of the company. Surprisingly, we found that the usefulness of tools has little inuence on whether a tool is adopted or not. Index TermsIndustry application, new product development (NPD), tools and techniques.

I. INTRODUCTION

EW product development (NPD) is critical for long-term rm performance [1] and has become a major source of competitive advantage as companies face an increasingly volatile external environments characterized by shorter product cycle time and ever quickening technological developments [2]. According to a survey conducted by the Product Development and Management Association (PDMA), successful high technology rms have found that more than 50% of their current sales came from new products [3]. Due to the high cost, inherent technical and commercial risks, new product development (NPD) is perceived as a high-risk activity that is prone to disappointing success rates [2], [4][7]. Over the last few years, several NPD process models, tools and techniques purporting to improve the NPD performance have been developed by academics, consultants and practitioners and implemented by companies [8], such as quality function deployment (QFD), design of experiment (DOE) and failure mode and effect analysis (FMEA) [3], [9], [10]. Indeed, tools and techniques play a key role in a company-wide approach to continuous improvement [9]. There are two aspects of tools application: adoption and diffusion [11]. Adoption refers

to a rms decision either to use a tool in the NPD process or to reject the use of such an instrument. Diffusion refers to the cumulative number of rms that has adopted NPD tools or techniques over time, including both within the company and across different companies. It is indicated that there is a positive relationship between the application of NPD tools and the companies performance [10], [11]. Intriguingly, the systematic application of NPD tools in industry, despite the extensive effort that has been invested and the long-term benets that may be achieved, remains mostly uncommon [9], [12]. Some possible reasons which may account for the low usage of NPD tools have been revealed in previous studies. However, most of the studies have focused on factors related to cultural, organizational, and project differences [11], [13][17]; few have examined in detail the inuence of those factors pertinent to the tool itself such as usefulness and user-friendliness. The relative importance of these factors on the application of NPD tools has never been discussed. In addition, these studies tend to examine only the diffusion of tool application [3], [17][19] in industrial countries such as the US, Britain and Japan, with no prior study in developing or newly developed economies such as Singapore. Addressing this gap, this paper investigates the adoption of NPD tools in Singapore as measured by frequency and thoroughness of the tools used. Tool related factors that may affect the application of NPD tools in industry are also explored. The research questions of this study are: 1) What are the commonly used NPD tools in industry? 2) How frequently and to what extent are these tools used? 3) What are the factors that affect the application of NPD tools in industry? 4) What is the relative importance of these factors? II. LITERATURE REVIEW NPD success is closely linked to the activities carried out in the NPD process, how well they are executed, and the completeness of the process [7], [20]. Grifn [8] notes that the best companies are more likely to use some type of formal NPD process than the rest. By dividing the NPD process into manageable stages for planning and control, companies can increase the probability of success and limit unnecessary expenditures [21]. Although there appear to be many different NPD process models, most of them consist of activities such as concept generation, product denition, prototyping, testing, manufacturing ramp-up and market launch. A number of tools and techniques have been developed over the years to improve NPD performance [3], [9], [10]. Many of these NPD tools have been created to address certain specic problems and tend to be used in particular stages of the NPD

Manuscript received May 1, 2005; revised October 1, 2005 and December 1, 2005. Review of this manuscript was arranged by Department Editor J. K. Pinto The authors are with the Industrial and Systems Engineering Department, National University of Singapore, Singapore 119260, Singapore (e-mail: iseckh@nus.edu.sg; g0403880@nus.edu.sg). Color versions of Figs. 1 and 2 are available online at http://ieeexplore.ieee. org. Digital Object Identier 10.1109/TEM.2006.883708

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process [12]. However, tools such as brainstorming and QFD may serve more than one purpose and can be used in many stages of NPD [10], [11]. Over the years, studies have been conducted on the applications of NPD tools like analytical hierarchy process (AHP) [22], benchmarking [15], brainstorming [10], [23], [24], conjoint analysis [25][28], DOE [29], FMEA [30], focus group [12], in-home use test [10], and QFD [3], [16] in industry. Empirical research has shown that sometimes users utilize the tools in a rather exible manner [10], at times for purposes for which they were not designed [10]. Some companies even reinvent the tools to t their special requirements [19]. While the use of these tools does not guarantee NPD success, they help to identify problems more systematically, complementing the companys effort to improve on the NPD outcome [31]. Although studies have reported a high degree of satisfaction for the NPD tools used [12], [32], a low level of application has also been reported [12], [33], especially when compared to the application in a manufacturing environment [9], [34]. Except for the relatively high usage rate of brainstorming, benchmarking, and focus group, the application of most of the other tools, such as QFD and DOE, was limited [3], [10], [12], [15], [17], [21]. The above discussions led to the question of what factors determine the application of NPD tools. In previous literature, factors such as differences in culture [14], [17], characteristics of organizations [11], [13], [15], [16], [35], novelty of projects or products [17], and even on the usability and utility derived from the tool itself [12], [19], [36] have been discussed. However, there is yet a comprehensive study on all the true factors to be written which determine the application of these tools in industries. Numerous studies have been carried out that focus on international comparison and show that culture affects the NPD success and, thus, inuences the application of NPD tools [14], [18]. For instance, it has been reported that the Mediterranean culture of Spain has a tendency to reject change, and this has a negative impact on the application of NPD tools [37]. In regard to the characteristics of the organization, it has been found that the level of interdepartmental communication, the number of stages in the NPD process, the number of department involved in NPD process and the companys NPD strategy were all related to the application of NPD tools [11]. In a recent study, Rigby [15] has found that top-down management support has a positive impact on the tools adoption, which conrmed the results of McQuater et al. [9] and Nijssen and Frambach [11]. Tidd and Bodley [17] have investigated the inuence of project novelty on the adoption of NPD tools and found that a small number of tools appear to be more effective in high novelty projects. With regard to the tool related factors, it has been found that complexity of the tool, such as difcult-to-use, hard-to-learn, and the lack of an easy-to-use software affect the application of NPD tools negatively [11], [36]. In addition, high monetary cost and inaccurate forecasting also inuence the tool application negatively [12]. In order to enhance the application of NPD tools in industry, Mahajan and Wind [12] propose that the time needed to implement a tool has to be reduced and that strong top management support needs to be present As NPD has become a critical factor for company competence and since tool application can improve the NPD perfor-

mance, a more comprehensive understanding of the application of NPD tools is necessary. However, most previous studies tend to examine only a single aspect of tool application: diffusion. With the exception of Calantone et al. [22] and Cristiano [38], very few studies have examined the frequency and thoroughness of tools adoption in industries. Indeed, most literature on NPD tools tends to focus on what the tools are for and how to apply them, with little emphasis on the level of application. With regard to factors affecting tool application, previous studies have tended to focus on environmental factors such as culture, but few of them examine the effect of industry nature. In addition, controllable factors, especially factors related to the tools themselves, have not been investigated systematically. In particular, there is no study which investigates the relative importance of the identied factors in different industries. Thus, there is a need to identify the more important factors so that the level of tool application could be improved. As indicated by Cooper [39], environmental variables do not play a critical role in deciding NPD success whereas controllable variables have a strong impact. Therefore, this study will focus on controllable factors, i.e., tool related factors and organization related factors in different industries. III. RESEARCH DESIGN This research adopted a combination of case study and survey method. The case studies, together with a literature review, were used to generate hypotheses. These hypotheses were then tested in a survey. According to Tiwana and Bush [40], this sequential progression of qualitative to quantitative methods across different phases of a study allows for a much richer and grounded understanding of the research phenomenon. IV. CASE STUDY AND QUALITATIVE RESULTS A. Case Study We conducted ten semi-structured interviews ranging from half an hour to one and a half hours to complement the literature review in order to develop the hypotheses. Unlike previous studies [19], we included the practitioner as well as the academic perspectives to highlight any similar or conicting views. These helped to provide valuable insights. By adopting a semi-structure approach, centered on a standard set of questions, interviewees were allowed to express and explain their perceptions as they choose, while maintaining the focus of the research. The interview questions were sent to all interviewees in advance to ensure that interviewees were properly prepared. Table I describes the list of interviewees and their associated information. All the interviews were tape-recorded and transcribed to facilitate an accurate interpretation. The interviews were structured around the following questions for the practitioners and academics, respectively. To Practitioners: What are the NPD tools commonly used in your company? What are the benets and shortcomings of these tools? What characteristics of NPD tools affect your choice of use? What other factors affect your choice of NPD tools? To Academics:

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TABLE I LIST OF INTERVIEWEES

What are your opinions of some of the NPD tools? What characteristics of NPD tools affect the choice of industries? What other factors contribute to the successful implementation of NPD tools in industry? Transcripts of the interview were sent back to the various interviewees to check the accuracy of the interpretation. Based on the results of the interviews and previous literature review, we developed ve hypotheses on the possible factors inuencing the application of NPD tools. B. Qualitative Results Based on the interviews, the most commonly adopted tool in the seven companies is benchmarking, which is adopted by all the companies. Besides its usefulness in NPD process, the application of benchmarking is likely to be associated with the exibility of the tool itself. FMEA and DOE are also adopted by the majority of the companies interviewed. In contrast, although QFD is strongly encouraged by some academics, none of the companies interviewed used the tool. The practitioners who are aware of QFD found it was tedious and time consuming, even though they agreed that the use of QFD might bring benets to the companies. From the gathered data, it is not apparent that there are any signicant differences between the perspectives of practitioners and academics pertinent to the reasons for application of NPD tools. Instead, the academics agreed that some tools required more time and commitment to be successfully implemented. It is likely that many companies do not apply tools which take more time when product development cycles are getting shorter. However, the interviewed academics believe companies need

more patience in order to enjoy maximum benets of the tools in the long run. V. THEORY AND HYPOTHESIS Based on the literature review as well as the interviews conducted, two categories of factors have been identied. These categories are: tool related factors and organization related factors. A. Tool Related Factors 1) Usefulness: The two primary reasons for companies to use NPD tools are to identify problems and improve the success rates of new products [12], [19]. A tool is worth using on the condition that it provides certain value, tangible or intangible, to the user. According to the Technology Acceptance Model [41], perceived usefulness is a major factor which inuences the users decision about how and when they will use a new technology. Micheal et al. [42] suggest that the decision to adopt a new product is based on the evaluation of the costs and benets of the new product. Project improvement and reduction in development time are tangible benets which can be observed in a relatively short time. In contrast, intangible benets, such as better understanding of customer needs and improvement in communication between cross-functional teams, are likely to be revealed in the long run. Because most Strategic Business Units (SBU) take a short-term perspective when evaluating a new products success [12], tangible benets are more important for companies when deciding whether to use a tool or not. This nding is in line with Nijssen and Frambach [19], who indicate that prediction inaccuracies are one of the major shortcomings of the NPD tools like QFD, which can be detected in a short period of time. To most of the interviewees in our study,

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TABLE II OBSERVATION FROM INTERVIEW AND RELATED LITERATURE

usefulness is a primary consideration among the internal factors that may inuence the application of NPD tools. However, most of the practitioners are more concerned with the tangible benets that can be achieved even though usefulness encompasses both tangible and intangible benets. Altogether, tools with higher level of usefulness, in particular those which bring more tangible benets, will attract more companies to use them. Thus, our rst hypothesis is as follows. H1: NPD tools which bring higher tangible benets will have higher level of application in industry. 2) User-Friendliness: Two fundamental aspects of user-friendliness are easy-to-use and easy-to-learn. Easy-to-use is the degree to which users are able to use the tool properly without much support from consultants or academic researchers. Easy-to-learn refer to the level of difculty to master a tool. If a tool is complicated, hard to learn, difcult to practice, and does not have any easy-to-use software that supports the approach, then most likely it will not be accepted

[36]. It is very difcult to achieve widespread use of any tool that takes more than a day or two to learn [36]. Since fast development of new products leads to greater protability and competitive advantage [43][45], and one-fourth of the lifetime prots attributed to a new product could be lost by an introduction delay of six months [46], time has become the top priority for many rms [47]. In order to speed up the NPD process, the efciency of the tools must be considered because any delay is costly to rms. A tool which requires a long period of time to learn is likely to lead to unwillingness to use [36], especially for projects that demand short cycle time. Therefore, tools which are easy-to-use and easy-to-learn are more likely to be adopted. Consistent with the statements above, the results of our interviews also reveal that time required to use a tool is a very crucial consideration when determining the choice of tools in many companies. Thus, we put forward the second hypothesis. H2: NPD tools with higher level of user-friendliness will have a higher level of application in industry.

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B. Organization Related Factors 1) Innovative Orientation of the Company Strategy: Strategic orientation is a determinant of a competitive sustainability [48]. According to the typology of differentiation strategy introduced by Porter [49], [50], a company can develop competitive advantage by producing innovative products. The stronger the innovative orientation of the company strategy, the more commanding the role NPD plays in overall business activities [51]. Innovativeness can be dened in terms of the products newness relative to the rm and the newness relative to the outside world [51], [52]. From the rms perspective, innovative products provide the possibility of dening the market or technological standards, creating barriers to a competitors entry [53], thus providing the rm with above-normal economic returns for a period of time. However, innovative products are also associated with high risks [54]. The design, manufacturing, and marketing methods of innovative products are often less well known for rms [53]. In addition, customer needs are often not well dened and competitor capabilities are not clearly established [55], leading to higher uncertainty in developing innovative products. As NPD tools help to identify problems systematically [31], [34], the uncertainty due to the innovative products may be decreased by using NPD tools. For instance, QFD and conjoint analysis can help companies to understand and translate customer preference and expectation into the appropriate design requirements in the early stage of NPD, mitigating the risk and uncertainty related to innovative products. Therefore, the development of innovative products may lead companies to adopt more NPD tools in order to reduce the uncertainty and improve NPD performance. Three practitioners and two academics in our interview also point out that development project of entirely new products, often also the most innovative for the rms undertaking such project, make more use of tools than development projects of marginal improvement. Therefore, we propose that a high innovative orientation of the company strategy will encourage tool application. In addition, studies have found that the R&D and innovative level varies across different industry categories [56][58]. For instance, the electronic industry in general has a higher emphasis on R&D and innovation than mechanical industry. In an industry with higher level of R&D and innovation, the company strategy will inevitably be more innovative oriented than those industries with lower level of R&D, and innovation as otherwise such company is not likely to survive the competition. As such, the application of NPD tools in an industry with higher level of R&D and innovation will be naturally higher than an industry with lower level of R&D and innovation. Consequently, the effect of the innovative orientation of the company strategy on the application of NPD tools in a high R&D and innovation industry will be less signicant than the effect in an industry with low R&D and innovation level. Thus, we develop the following hypotheses. H3a: A higher innovative orientation of the company strategy will lead to a higher level of NPD tools application in industry. H3b: This effect will be less signicant in an industry with higher R&D and innovation level than in an industry with lower R&D and innovation level.

2) Management Support: It is now commonly believed that management support is vital to the success of NPD. In general, this support may include 1) sufcient resources, in the form of people, time, and money, for creativity and excellence in NPD to take place [59][61]; 2) personal involvement in the NPD program [16], [62], [63]. The importance of management support for successful innovation and NPD process has been well documented in the previous literature [2], [37], [64]. Yap and Souder [65] have found that early top management involvement can enhance the NPD success rate. Rigby [15] has indicated that top-down management support contributes to the successful implementation of NPD tools. For instance, the successful application of QFD is highly affected by management support [35]. Indeed, the lack of NPD tools application has been attributed to the low level of awareness among managers of the existence of these NPD tools [12] as well as their limited faith in the usefulness of these tools [21]. Thus, we propose the following. H4: A higher level of management support will lead to a higher level of NPD tools application in industry. 3) Firm Size: The impact of rm size on the adoption of innovation and the application of NPD tools has been investigated in previous research. Kimberley and Evanisko [66] have found that large rms adopt innovation more quickly than small rms. Generally, large organizations have more formal NPD process than small rms. As such, NPD tools may be more commonly used in larger organizations than in smaller ones. Moreover, large organizations may need more new products to support their organization, which will stimulate the application of NPD tools. In contrast, scarcity of resources is a major disadvantage for many small rms. The number and variety of specialists that these rms can afford to employ is limited. Thus, a lack of both breadth and depth of expertise may constrain most small rms to developing products within their narrow areas of competency [65]. In addition, small rms seldom have sufcient resources to sustain many failures before developing a successful product. Their scarce resources must be at least partially deployed on low risk projects, line extensions and me-too products that protect their survival. Therefore, small rms have lower needs to use NPD tools because of the lower rate of NPD, as well as the lower rate of developing innovative products. On the other hand, the effect of rm size on R&D level may depend on the nature of industry. Frenkel et al. [57] and Shefer and Frenkel [67] found in industries with low R&D and innovation level such as mechanical based industry, there is no signicant relationship between the intensity of R&D activities and the company size. Consequently, the effect of the rm size on the application of NPD tools will be lower in the industry with low R&D and innovation level. Therefore, we propose the following. H5a: Firm size has a positive effect on the application of NPD tools in industry. H5b: This effect will be less signicant in an industry with lower R&D and innovation level than in an industry with higher R&D and innovation level. The ve hypotheses developed based on interview and literature are listed in Table II.

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VI. QUESTIONNAIRE SURVEY A. Implementation of the Questionnaire Survey A questionnaire survey is conducted to understand the industrial perspective on the application of NPD tools and to test our hypotheses. Our survey is conducted among Singapores manufacturing companies by posted questionnaires. The main mailing list is that used by Singapore Economic Development Board (EDB) for their survey of all manufacturing companies in Singapore. Based on standard industrial classication (SIC) code 1987, the ve targeted categories covered in this study are: (34) Fabricated Metal Products, (35) Industrial Machinery and Equipment, (36) Electronic and Other Electrical Equipment, (37) Transportation Equipment, and (38) Instruments and Related Products. To supplement the above, we added the same categories of companies from the Singapore 1000 list, which is a government ranking of the 1000 best performance companies in Singapore based on their nancial results. One constraint of this research is the lack of a list of companies which are known to carry out NPD in Singapore. For the purpose of our research, we focused on senior managers in R&D department or project leaders in NPD project teams. We wanted to assure that most of our respondents would be familiar with our topic and the NPD practices in their companies. Our design of survey was based on Frohlichs [68] technical note so as to improve the response rate of the survey returns. We mailed each company a covering letter with university letterhead explaining the aims and benets of the research, a copy of the questionnaire and a postage pre-paid envelope. In the questionnaire, necessary denitions of NPD tools were provided. Two weeks after the rst mailing, a reminder letter was sent to those companies which had not yet replied. We did not send a second reminder letter since a second reminder letter can not signicantly improve the response rate as compared to the rst reminder letter [69]. No tokens were provided to participants for lling this survey. Instead, we sent a summary of research ndings should the respondent prefers. The questions were reviewed by four people knowledgeable on the NPD process and the application of NPD tools for its content validity. They were a director (industry and operation) of a research institute with more than 30 years of industry experience, a research scientist in a company, a senior lecturer majoring in NPD, and a senior visiting fellow at a university with 25 year industry experience. These reviews let to minor changes in the wordings of the questions for better suitability for companies in Singapore. The construct validity of the questionnaire was tested by conducting a conrmatory factor analysis. The results show that all the items are loaded higher (range from 0.575 to 0.875) in the expected factor and lower in the other factors, which conrm the construct validity of the questionnaire [70]. The reliability of the questions was tested by computing the Cronbachs alpha coefcient and was found to range from 0.67 to 0.89 (see Table V), all within the acceptable range [70], [71]. B. Measures The unique dependent variable in this study is the application of NPD tools in industry. Two dimensions of application

are measured, they are adoption and diffusion. Following previous studies, adoption was measured by frequency [22] and thoroughness [38], diffusion within an organization was measured by number of tools adopted per company, and diffusion among organizations was measured by number/percentage of companies adopted each NPD tool [72]. Based on previous literature and our case study, eight tools which have a relatively high awareness rate are included in our questionnaire. The independent variables in this study are the possible factors which may affect the application of NPD tools in industry. Except for rm size, which is measured by natural logarithm of the full-time employee number [73], [74], all the other factors are measured by attitudinal statements. Each statement was mea, sured by a 5-point Likert-type scale ( ). With regards to industry, we grouped the ve industry sectors in our list into two categories based on their technological character [67]. The rst group, Industry group I, is mechanical based which includes fabricated metal products, industrial machinery and equipment, and transportation equipment. The second group, Industry group II, is electrical based and commonly seen as more high-tech, includes electronic and other electric equipment, and instruments and related products. This group of industries is also perceived to have higher uncertainty and tend to focus on R&D and innovation than the rst group of industries [56][58]. VII. RESULTS AND DISSCUSSION Out of 1426 companies in the mailing list, 986 were unreturned, 317 were returned, 117 were undelivered due to inaccurate address, 5 companies have closed down, and 1 company telephoned to decline participation. The overall response rate was about 25%, which is satisfactory for this kind of survey [75], [76]. Among the companies that responded, 248 were not currently engaged in NPD, another two companies with NPD sent incomplete replies. The useable data, thus, dropped to 67 companies, which was 5.14% of the companies. This response rate is slightly lower than the response rate (7.1%) conducted by Wan et al. [77] on the NPD activities in Singapore. We attribute the low response rate to the incapability of identifying companies which were known to have NPD. Another limitation was the inaccuracy of the list. The database we used was last updated in 2002. Some of the respondents names or the targeted companies addresses have changed, while some companies have closed down. Given these limitations, we believe the response rate is acceptable. The largest group of respondents is R&D manager (about 44%, see Table III), and other managers covered about 42% of the responses. Thus, it could be expected that the responses were familiar with our topic and the NPD practices in their companies. The company size in the respondents prole (see Table III) shows that about 73% companies are small and medium size, with less than 500 full time employees. In this survey, we found that the average tools applied in each company (diffusion within company) was about four, which was higher than the three that was reported by Nijssen and Frambach [11] in their survey of 125 Dutch companies with a list of thirteen NPD tools. For the number of companies that adopted each tool (diffusion among companies, see Fig. 1), it was found that

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TABLE III PROFILE OF THE RESPONDENTSJOB TITLE OF RESPONDENTS AND COMPANY SIZE

Fig. 1. Number of company use NPD tool and thoroughness level.

the most commonly used tools were brainstorming (59 companies or 88% of the respondents), benchmarking (43 companies or 64%), DOE (55%), and FMEA (55%). All of these four tools were used by more than half of the companies. In particular, brainstorming was used by about 90% of the companies. The results of our survey conrm the ndings from previous studies on the high usage of brainstorming and benchmarking [10], [15], [21], [24], and on the low usage of QFD [3], [16], [17], [24]. Considering thoroughness (see Fig. 1), FMEA was the tool most thoroughly used among the tools we surveyed, with a mean of 3.97 and a standard deviation of 0.83 (under 5-point Likert, ). The thoroughness type scale, level of all the tools was centered on 3 and 4. With regards to frequency of use (see Fig. 2), brainstorming ) and benchmarking ( ) were the ( most frequently used tools in pre-development stage, conjoint ) and FMEA ( ) were analysis ( the two most frequently used tools in development stage, and in-home use test was the most frequently used tool in post development stage, with a mean of 3.95. Our study conrms that most NPD tools were designed to address certain specic problems at different stages of NPD process [12]. For instance, in-home use

test was the least commonly used tool in pre-development stage, but the most commonly used tool in post- development stage. The survey also reveals that the variation of application frequency for these NPD tools is smaller in development stage than in pre-development and post-development stages. This could be explained by the nature of the three different stages. At pre-development stage, more uncertainty is involved because of the fuzzy nature [6], [78], [79], therefore, the practice and knowledge of which tool to use are less established. Whereas in the development stage, the objective is more certain [80] and hence engineers are usually more assured about their tasks and what tool to use. At the post-development state, although the objective is clear, a wide range of other tools (especially those related to production) could be used due to the variety of tasks involved in, such as testing, trial, and launch [81]. This may lead to lower frequency of NPD tools used at post development. We also found that among the 29 companies which use QFD, 20 of them also use FMEA, indicating the existence of QFD/FMEA interface [30]. The result of the regression analysis performed to test our hypotheses is shown in Table IV (Refer to the column of All rms). Five hypotheses in our model were supported by the

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Fig. 2. Frequency of the application of NPD tools.

TABLE IV REGRESSION RESULTS FOR FACTORS RELATED TO THE APPLICATION OF NPD TOOLS.

survey results. They are: 1) innovative orientation of company strategy (H3a); 2) less signicant effect of innovative orientation of company strategy in industry with higher R&D and innovation level; 3) level of management support (H4); 4) the size of the company (H5a); 5) less signicant effect of size in the industry with lower R&D and innovation level. The impact of user-friendliness of the tools application (H2) was found to be negative on the application of NPD tools, instead of the hypothesized positive relationship. With regards to usefulness of the NPD tool (H1), although the effect is positive, it is not statistically signicant. Thus, these two hypotheses were not supported. Our hypotheses predicted that the degree of user-friendliness of NPD tools should positively affect (H2) the application of NPD tools. However, we found signicant negative impact of this factor on the tool application. A closer examination of pre-

vious studies reveals similar contradictory prediction of the effect of user-friendliness on tools application in industries. For most NPD tools, training and education were required [34]. McQuater et al. [9] found that poor training negatively impact the adoption of tools. According to Killander [36], the lack of widespread of tools could be due to the difculty of learning the tools. This implies that high level of user-friendliness of the NPD tools might bring high level tool application. However, Yap and Souder [65] found that the use of easy-to-use, off-the-shelf technologies seldom completely solved problems and would hinder the commercial success. Similarly, in our study, the results show that the main reason of not using DOE, FMEA, and focus group is time consuming and the main reason for not using QFD is too complex to use, both of which can be related to user-friendliness. These ndings indicate that although some tools (e.g., QFD) have been highly advocated by acade-

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TABLE V MEASURE OF THE VARIABLES IN THE QUESTIONNAIRE

mies for their usefulness, they are not commonly used due to the low user-friendliness. In contrast, our survey shows that the main reasons for not using benchmarking and brainstorming, the two most commonly used tools in our survey, are little tangible benets, which is related to usefulness. As such, the advantage of high user-friendliness could be reduced by the disadvantage of low usefulness of these tools. This is particular true for small and medium rms [65], which constitute 75% of our sample. The positive impact of usefulness of the NPD tools on the application of NPD tools was a prediction in our study (H1). However, surprising, we observe little signicant impact of the tool usefulness on the tool application in industry. One possibility is in the presence of macro factors with wider impact such as company strategy and management support, the usefulness of tool itself become less a driver for tool application in industry. By examining the standardized coefcients , we obtain the relative importance of all the factors on the application of NPD tools. Among all the factors, management support in the company and innovative orientation of company strategy are the two most remarkable ones. Both of them are highly correlated to tool application in industries. Comparing the regression results between the two industries groups (I and II) (see Table IV), we nd that management support and innovative orientation of the company strategy positively affect the application of NPD tools, while user-friendliness of the NPD tool negatively affects tools application in

both industry groups, albeit with varying degrees. The innovative orientation of the company strategy is the most signicant factor which positively affects the tools application in the and ), mechanical based industry (with but shows less signicant effect in the electrical based industry and ), as predicted by our hypoth(with esis H3b. As indicated by Bauly [82], in Singapore, the NPD level of the mechanical based industry is lower than the electrical based industry signicantly. This could also be conrmed from our data by using the independent sample t-test, which shows that the application of NPD tools in the rst group is signicantly (signicant level is 0.05, two-tailed) lower than the second group. Therefore, when the mechanical based industry do NPD, it becomes a major activity for them and hence their innovative orientation is more important than in the electrical based industry. The other difference is that rm size has no effect on the tools application in the mechanical based industry, but signicantly positive related to the application of NPD tools in the electrical based industry, which conrms our hypothesis H5b. This may because the effect of the rm size on the tools application may be weakened due to low degree of NPD in the mechanical based industry. VIII. CONCLUSION AND IMPLICATION This research contributes to the understanding on the application of NPD tools and the factors that may affect the tool ap-

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plication in the context of Singapore. It was found that about four tools were applied per company. Among the tools we selected, brainstorming is the most commonly used tool in industry. Benchmarking, DOE, and FMEA are also applied by more than half of the respondents. The thoroughness level of all the tools was centered on 3 and 4 (under 5-point Likert-type , and ), with FMEA as the scale, highest level ( ). With regard to frequency, our ndings conrm that most NPD tools were designed to address certain specic problems at different stages of NPD process. From the research ndings, it is evident that management support, innovative orientation of company strategy, and rm size are positively affecting the application of NPD tools. In particular, management support is the most critical factor. There are several implications from the ndings. First, the negative impact of the user-friendliness and the insignicant impact of usefulness indicated that a balance is required when designing, improving, and choosing the NPD tools. For specic tools, such as QFD and FMEA, they may have a higher level of usefulness but lower level of user-friendliness. For general tools such as brainstorming and benchmarking, the level of user-friendliness needs to be high but in turn the usefulness level will be low. In such a situation, the selection of NPD tools should be based on the unique requirement of the company involved. This suggests that when designing the tools, researchers should consider the demand of the end users closely rather than compromising tool usefulness by over-emphasizing user-friendliness in order to reduce training costs for companies. Second, the ndings of this study could also give some insights to industrial practitioners. Our ndings show that management support is the most inuential factor on the application of NPD tools. This is consistent with studies in the area of innovation adoption where top management is vital [83]. Since the use of NPD tools will increase NPD success, managers should show strong commitment to the use of such tools. Third, the signicant impact of the innovative orientation of company strategy on the application of NPD tools implies that managers should realize that without an innovative orientation at the organizational level, advocating the application of NPD tools at a project level could be futile. Finally, the high unknown rate (38%) of QFD, a tool well researched and widely recommended by academics, clearly demonstrates the gap between academic proposition and industrial reality. It is clear that academics need to increase and channel more effort in transferring such tools to industry, rather than developing new tools with little prospect of real use in industry. Although this research has generated a new understanding on the topic through a combination of past literature, case studies, and questionnaire survey, there are several limitations which require future research. First, while we have identied the level and factors affecting the application of NPD tools in industry, companies themselves still have to choose NPD tool based on their unique condition (e.g., education level of employees, access to expert for training, history) it is, thus, useful to see how these conditions would affect the choice of NPD tools, as well as when and why companies design their own NPD tools. Such studies may be in the form of in-depth, longitudinal qualitative case study approach comparing a small group of

companies. Second, one limitation for this is that the number of toolseightcan be too large. A detailed investigation could not be conducted on each tool without signicantly lengthening the questionnaire. Therefore, the combination of these general and specic tools may not describe the level of tool application quite accurately. Future research could focus on less number of tools in order to get a better understanding. One approach may involve conducting case studies which track the application of different NPD tools in one or more companies. This kind of study could help us to understand the benet of each tool more accurately and make better use of different NPD tools. Third, although industrial difference has been taken into account in our analysis, the small sample size constraints the analysis. Further study focusing on specic industry with large sample size will be meaningful. Fourth, the low response rate warrants caution when generalizing the ndings. Future studies should ensure a high response rate by considering telephone or face-to-face structured interviews. Finally, the data collected for this study used the key informant approach [84], [85], at such all conclusions should be interpreted with this possible bias in mind. Two signicant drawbacks of the key informant approach are: 1) Information bias due to the differences related to the informants varying organizational roles [86], individuals memory failure or inaccurate recalling of past events [87], which may lead to un- comprehensive understanding of the events in the company; 2) Random error results from hindsight bias, attributional bias, subconscious attempts to maintain self-esteem, or impression management [88], [89], which may result in less correspondence between informant reports and actual events. Therefore, future studies should consider multiple respondents from different seniority and functional background. ACKNOWLEDGMENT The authors would like to thank J. Bauly, C. M. Yap, and E. Thia for their advice and assistance, and both the department editor and the anonymous reviewers for their helpful comments and suggestions on earlier drafts of this paper. REFERENCES
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Kah-Hin Chai (M02) received the Ph.D. degree in the area of manufacturing management from the Cambridge University, Cambridge, U.K., in 2000. He received the Masters. degree in manufacturing management from the University of South Australia, Mawson Lakes, Australia, in 1996, and the Bachelor degree in electrical engineering from University of Technology Malaysia, Selangor, Malaysia, in 1992. He is an Assistant Professor with the Industrial and Systems Engineering Department, National University of Singapore (NUS), Singapore. His work experience includes management consulting and semiconductor manufacturing in Singapore and Malaysia. His current research interests are new product development, service innovation, and knowledge management. He has published in IEEE TRANSACTIONS ON ENGINEERING MANAGEMENT, the Journal of Service Research, Creativity and Innovation Management, and the International Journal of Technology Management.

Yan Xin (S05) received the Master degree in engineering in the area of engineering management from the National University of Singapore (NUS), Singapore, in 2005 and the Bachelor degree in engineering from Xian Jiao Tong University, Xian, China, in 1998. She is working towards the Ph.D. degree in Industrial and Systems Engineering Department, NUS. Before joining NUS, she worked at supply chain management in China. Her current research areas are service development and innovation.

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